Jan. 6, 2014
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Rem Rieder is a media columnist for USA TODAY. / USA TODAY

by Rem Rieder, USA TODAY

by Rem Rieder, USA TODAY

The bitterly divided owners of Philadelphia's newspapers can't agree about much of anything when it comes to how the dailies and related digital operations should be run.

So it's hardly a surprise that they can't agree on how to exit the completely untenable situation they have created.

The good news is that everyone recognizes that the transcendentally dysfunctional status quo has got to go.

For months, Interstate General Media, which owns the Inquirer, the Daily News and philly.com, has been riven by an extraordinarily ugly split between the two owners who make up the paper's management committee. Exacerbating the mess is the fact that the two men must agree on decisions about running the place - and these two guys couldn't agree on where to go to lunch.

The situation exploded into public view in October, when Inquirer Publisher Bob Hall, aligned with one of the committee members, fired Editor Bill Marimow, closely tied to another.

In a highly unusual development - and everything about this debacle is highly unusual - the pro-Marimow owner went to court to seek the ouster of Hall and the return of Marimow. He went one for two as a Philadelphia judge ordered Marimow back on the job but said Hall could stay, too. That decision, of course, is being appealed.

Marimow is backed by management committee member Lewis Katz, a businessman and former owner of the New Jersey Nets, as well as another owner, H.F. "Gerry" Lenfest. They want the company put up for public auction, where they plan to bid for it, and have asked a Philadelphia court for permission to pursue one.

"Both parties ... have recognized that there is an impasse that can't continue in terms of how the company is managed," Richard Sprague, a lawyer for the Katz/Lenfest forces, said in a statement. He might be on to something.

Naturally, the rival faction, headed by South Jersey political power and businessman George Norcross, took umbrage at this approach. It went to court - a different court in a different state - seeking an alternative path out of the morass.

Rather than let the masses in on the action, the Norcross forces asked the Court of Chancery in Delaware to give its blessing to a private auction at which only the current owners can bid.

Norcross and fellow owner Bill Hankowsky said in a letter to Katz that he was bent on "creating a crisis" and that a public auction could cause plenty of damage for the beleaguered news outlets, which have had five owners in seven years.

"A public auction would be open to third-party bidders, including hedge funds and others who may not want to keep all three outlets open," they wrote. "There is a real possibility that a winning bidder could saddle the company with too much debt, just as a previous ownership group under Brian Tierney did when he led it into bankruptcy."

Sprague fired back that there was a simple reason his clients had chosen their course. "Mr. Katz and Mr. Lenfest are interested in securing the highest value for the company, which is why in their petition for dissolution of the assets, they have asked for a single-bid public auction," he said.

And, he added, "to clarify, the Norcross 'spin' that a public auction would jeopardize jobs and risk bankruptcy has no validity."

In happier times, Katz and Norcross were allies. After they and four other wealthy locals bought the much-bartered papers in 2012, the two men decided to bring back Marimow, a highly respected editor, to the top newsroom spot. Marimow, once a Pulitzer-winning Inquirer investigative reporter, had a previous stint as the paper's editor. But when the company changed hands in 2010, the new owners demoted him because they felt he wasn't digital enough. Marimow went off to teach journalism at Arizona State University, but he jumped at the chance to run the Inquirer newsroom again.

As time went on, Norcross and Hall decided that Marimow wasn't moving fast enough on some of the changes they wanted to implement. But the editor continued to enjoy the strong support of Katz, whose companion, Nancy Phillips, is the Inquirer's city editor and a Marimow protege.

After an uncomfortable meeting between Marimow and Norcross at which the co-owner brandished research suggesting there was little interest in the paper's editorial pages and local columnists and Marimow pushed back, the relationship deteriorated, and Marimow found himself under relentless pressure from Hall.

Remarkably, while it is a far cry from the paper's glory days after years of punishing budget cuts and turmoil, the Inquirer has continued to produce excellent local journalism. But the extraordinary events of recent months have taken their toll on a staff that already had been through a great deal.

One Inquirer staffer, who asked not to be identified because the company has ordered its journalists not to talk to the press (!), says the ceaseless melodrama is a huge distraction. While the journalism goes on, the source says the unpleasantness is a constant psychic drain, and there is a great deal of fear about the future.

Understandably so. All the more reason the situation has to be resolved, and soon, in a way that protects and nurtures ambitious newsgathering. Philadelphia desperately needs it.